Crowdcube and Octopus Investments are opening up retail investments in new partnership by creating a solution that lowers the minimum level of investment into VCTs to £500.
Ordinarily, the usual minimum investment into a Venture Capital Trust (VCT) has been between £3,000 and £5,000, meaning thousands of retail investors are excluded from investing in these companies who are listed on the London Stock Exchange.
Under the terms of the partnership, Crowdcube makes Octopus Investment VCTs available for investment via the Crowdcube platform to include their flagship funds, such as Titan VCT and Apollo VCT. Apollo will be the first VCT to become available, with a 2% initial fee upon investment and an ongoing annual fee of 0.4%.
Crowdcube has raised over £1.2 billion from a community of over 1 million retail investors for 1,300 businesses that include Monzo, Brewdog, Revolut and What3Words.
“Over the last ten years, we have transformed the landscape for retail investing by creating more pathways for retail investors to invest in high-performing private companies than ever existed before. We took something that was the preserve of the few and made it accessible to the many,” says Matt Cooper, Co-CEO at Crowdcube.
“This partnership is a natural continuation of that effort. Octopus has an excellent track record of delivering competitive returns for its VCT investors and is one of the biggest names in the business. We’re excited that two leading UK financial technology companies can come together to engage with a new generation of UK retail investors for the very first time.”
Octopus provided retail investors with access to some of the UK’s biggest success stories, including Zoopla, Secret Escapes, Graze and Depop, through VCT investments.
“Investing in companies at initial public offering (IPO) stage was the tried and tested route for many retail investors to boost their wealth in years gone by, but increasingly, as companies stay private for longer, this source of investment is drying up. Retail investors have been largely locked out of the private company access that many institutional investors have enjoyed. This needs to change and it’s up to the investment industry to break down those barriers,” says Ruth Handcock, Board Director, Octopus Investments.
“Crowdcube has long championed greater access for retail investors to private companies, a philosophy that we too have wholeheartedly supported since Octopus began investing in high-growth, early-stage companies at the turn of the millennium. Our partnership provides an exciting opportunity for investors who might be new to the VCT asset class, but have the appropriate risk appetite, to invest in a diversified range of future technology stars,” she adds.
